New Research From Fidelity Investments Reveals More Americans Prioritize Discussing Family Finances

In a Nutshell: Just-released research from Fidelity Investments finds more American families engaging in substantive conversations about their finances. Fidelity’s 2024 State of Wealth Mobility study shows families actively discussing their mutual financial future and aiming to pass on greater wealth than they inherited. Fidelity Investments helps millions of American households turn conversations into action.

Passing on more than you inherited is a cornerstone of the American Dream. But families sometimes avoid sensitive conversations about money in ways that can hurt their mutual prospects, according to the newly released 2024 State of Wealth Mobility study from Fidelity Investments.

The first-of-its-kind study comes at a time when millions of older Americans, primarily boomers, are transferring their assets to younger family members, mainly millennials, in what some are calling the “Great Wealth Transfer.” By 2048, younger Americans and charities will have received up to $124 trillion this way, according to Cerulli Associates.

Communication is essential to maximizing the benefits of wealth transfer. A majority of Fidelity respondents reported little talk about family finances when they were young. In more than a few families, cultural stigma worked (and continues to work) against even raising the subject.

Fortunately, there’s ample evidence that change is ongoing. Over 80% of respondents said they felt they would have benefited from financial education at an earlier age. About that same percentage also said it was essential to talk to the young people in their lives about their money future, and two-thirds reported they were actively engaged in those conversations.

It speaks to an ongoing need that crosses household and generational boundaries, said Fidelity’s Vice President of Wealth Offerings Chris Kalich. Crucially, Kalich noted, these are conversations families at all income levels ought to have.

“It’s a common misconception that the Great Wealth Transfer is only something people with millions need to think about,” Kalich said. “However, most people have at least some assets that get passed down to their heirs. It could be a home, savings, or even personal effects.”

The challenge is always to build productively from what you have. All too often, families wait until a significant event occurs to have critical money discussions. Kalich encourages all American families to join the openness trend.

“It’s so important to ensure the next generation is prepared,” he said. “The good news is it’s never too late to start.”

Advice, tools, and resources from Fidelity help millions of American households and businesses take confident steps toward a better financial future. The authoritative 2024 State of Wealth Mobility study surveyed 1,900 American consumers of various generations and financial tiers.

Getting your family to where Fidelity wants all households to be requires effort from all parties to ensure decision-making takes the broadest possible set of interests and desired outcomes into account. Evidence of the necessity in the survey is that 4 in 10 respondents said they worry they could lose their wealth. Those with a plan in place have significantly higher levels of confidence.

“Good things happen when people improve their comfort level about discussing family finances,” Kalich said.

Among the survey’s most revealing findings are those that shine a light on our financial self-perceptions and markers of wealth. Although the survey reported 89% of Americans don’t consider themselves wealthy, 35% believe they’ll achieve it.

Interestingly, all Americans hold similar markers of wealth regardless of whether they’re in the vast majority or among the 11% who consider themselves a cut or two above. For a majority of respondents in both categories, for example, wealth meant not living from paycheck to paycheck.

On the other hand, respondents in both categories reflected their priorities when those in the wealthier category placed a higher premium on home ownership as a marker, and those not considering themselves wealthy considered the ability to pass on an inheritance more critical. There’s no one-size-fits-all solution to the problem of intergenerational and cross-household communication that the survey indicates most are successfully trying to solve.

“Reassuringly, folks are starting to change course,” Kalich said. “Perhaps as a result, nearly three-quarters of respondents are hopeful the next generation will attain a higher level of wealth than what they have today.”

It’s not a coincidence that Fidelity released the 2024 State of Wealth Mobility study in time for the holidays. If the way you celebrate in your family involves travel and visits to friends and family back home, let the survey’s arrival signal your intention to overcome whatever barriers there are to discuss sensitive matters of household wealth and inheritance while you’re together.

“When your family gathers, it may be a perfect time to bring the subject up and start breaking the ice,” Kalich said.

If, say, you’re a financially independent adult with active and retired parents back home, consider “publicizing” your positive financial behavior during your visit. It might prompt your parents to reveal their own — or perhaps discuss areas where they could use some improvement.

Then, weave the discussion into broader areas of their wealth management strategy. Think of the optics: A son or daughter, home for the holidays, with a family in tow and a sound financial management plan in hand. That’s bound to prompt some searching discussion.

“One way to kick off a conversation is to chat about how you’ve established an estate plan to protect your loved ones,” Kalich said. “Or casually toss out how important it is that kids have access to their parents’ personal finance information in case they ever need help managing their money.”

The idea is to get a group who don’t live together or even think the same way on the same page about the best possible outcome for their family’s finances. Even better is when siblings work together — provided you’re all on your own and planning responsibility for your financial future.

That may be the time for those with children to introduce the topic of wealth planning for inheritance purposes casually and steer the resulting conversation to matters of substance. Start preparing for your visit now — and try not to leave without getting something done.

“It’s critical to have these conversations before any crisis occurs to help you make the most of your cherished time with loved ones,” Kalich said.

Fidelity has worked to help families like yours negotiate the hurdles of financial planning and wealth management for generations. As the Great Wealth Transfer continues, Fidelity’s 2024 State of Wealth Mobility study points toward greater family financial cohesion to achieve better results for many.

There wasn’t much of a secret about what the high-net-worth survey participants credited for their achievements because it’s what every Fidelity advisor espouses daily: Stick to the fundamentals.

Indeed, those who considered themselves wealthy in the survey reported that investing strategically, saving from a young age, and consistently saving a portion of their paycheck were the keys to their success.

Those are challenges almost every American family can meet when they start small and stay strong. Even investing isn’t out of reach for most who can discipline themselves to avoid unnecessary spending.

“We know strategic investing can be the most intimidating, as our study also found that 78% of Americans wish they were better investors than they are today,” Kalich said. “However, it doesn’t have to be, as you can always outsource it.”

That means working with a trained and certified financial advisor who has your best interests at heart, such as those at Fidelity.

In 2024, Fidelity expanded access to its personalized wealth management offering enabled by the Unified Managed Household platform — which provides goal-based planning and investment management across a household in a tax-smart way.

This approach can help clients plan together and understand common goals between partners or across a family. The wealth management industry highly regards the Unified Managed Household platform. However, historically, it’s been exclusive to ultra-high-net-worth individuals, typically those with over $10 million available for investment.

Today, all Fidelity advisory clients with a minimum investment of $50,000 now have access. It’s one more way Fidelity keeps families like yours in sight of the goals its State of Wealth Mobility Survey highlights.

That’s why Fidelity can be for you, even if you’re still building your credit score and getting your priorities together. In fact, that may be the best time of all to contact an advisor and get the ball rolling.

“Our household and family comfort really comes down to sticking to the fundamentals,” Kalich said. “At Fidelity, we’re constantly focused on innovating financial solutions to help more people plan for the future they want.”